GDP: Preliminary Estimation for 2016Q3 and Outlook for 2016-17
Contact Information : Economic Forecast Section, Department of Statistics, Directorate General of Budget, Accounting & Statistics (DGBAS)
Tel : 886-2-2380-3487
November 25, 2016 Taiwan's real gross domestic product (GDP) grew by 2.03% from the same quarter of the previous year in 2016Q3, according to the latest preliminary estimation. The GDP is predicted to grow 1.35% and 1.87% in 2016 and 2017, respectively.
Preliminary Estimation of Real GDP in 2016Q3
The real GDP increased by 3.91% on a quarter-on-quarter, seasonally-adjusted annualized basis (saar), and grew by 2.03% on a year-on-year basis (yoy) in 2016Q3, 0.03 percentage point lower than the advanced estimate.
Meanwhile, the economic growth rate of 2016Q1 and Q2 have been revised to -0.23% and 1.13% (formerly -0.29% and 0.70%).
On the demand side, real private final consumption expanded by 2.46% (yoy) in 2016Q3, faster than the 1.59% growth in the previous quarter, primarily due to the increase of consumption on transport, communication and miscellaneous-goods- and-services.
Real gross capital formation grew by 3.11% (yoy), a reversal from the 1.64% decline in the previous quarter. The growth was supported by machinery & other equipment.
Real exports of goods and services increased by 3.59% (yoy), which was mainly driven by the foreign demand for electronic components. Imports also increased by 5.27% (yoy).
On the production side, the manufacturing sector increased by 5.17%(yoy) in 2016Q3, compared to the 0.29% growth in the previous quarter, mainly due to output expansion of semiconductor and chemical material products.
The construction sector decreased by 2.51% (yoy), following the 2.24% decline in the previous quarter, partly attributing to the continuing wet weather and weak demand.
The wholesale & retail trade sector expanded by 1.58% (yoy), a turnaround from the 0.78% contraction in the previous quarter.
Transportation and Storage sector grew by 5.12% (yoy) in 2016Q3, faster than the 2.01% growth in the previous quarter, primarily due to the continued expending demand of air transportation supported by the growing number of trips taken by citizens and also contributed by the growing number of passengers taking THSR and MRT.
Forecast for 2016
Taiwan's exports are expected to continue to improve in 2016Q4, mainly benefit from the remarkable rebound of semiconductor market and the rising commodity prices. In the domestic sector, semiconductor manufacturers are speeding up the expansion of advanced capacity, helpful to maintain the growth momentum of private fixed capital formation. Meanwhile, real private consumption is anticipated to grow at a modest path, reflecting the interaction of government’s tax reduction policy to boost car market and the limited increment of salary and employment.
For the whole 2016, taking into account the above factors and following that real GDP growth rate (yoy) was upwardly revised to 0.99% (formerly 0.82%) in the first three quarters, Taiwan's real GDP will grow by 1.35% and has been revised upward 0.13 percentage point.
Consumer price Index (CPI) will increase 1.31% in 2016 and has been revised upward 0.19 percentage point, because of the high price of food resulted from the damage of extreme weather and the influence of typhoon.
Outlook for 2017
Global economy and world trade volume are anticipated to grow slightly faster in 2017, together with the emerging demand of new smart application, such as IOT and automotive electronics, will bring gains to Taiwan's goods exports. Coupling with services exports, real exports of goods and services will grow by 3.83% in 2017.
Real private fixed capital formation will grow by 2.00% in 2017, supported by the continuing investment of semiconductor industry and government’s strategies to encourage innovative industries and to improve investment environment, offsetting the influence of declining housing market. Real private consumption will grow moderately by 1.74%.
Combining with public sector, Taiwan's real GDP is predicted to grow by 1.87% in 2017. CPI will gently increase 0.75%.
Revision for the 2014 and 2015 National Accounts
DGBAS also released the annual revision of the 2014 and 2015 national accounts. The yearly GDP growth rates have been revised to 4.02% (original 3.92%) for 2014 and 0.72% (0.65%) for 2015.
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